Canada’s Suncor Energy is continuing talks with French oil major TotalEnergies about buying its nearly one-third stake in the Fort Hills oil sands mine, Suncor’s CEO said on Tuesday.
Chief Executive Rich Kruger said he expects a resolution of the talks this year. Canada’s second-largest oil producer is looking to increase its bitumen supplies to replace its aging Base Mine.
“We generally would prefer to operate and have 100% ownership of our assets; that’s generally where we think we can add the most value and be the most competitive,” Kruger said on a quarterly conference call. “Fort Hills would fit into that.”
Total owns a 31.23% stake in Alberta’s Fort Hills, with the operator Suncor owning the rest.
Suncor agreed in April to buy Total’s Canadian operations for C$5.5 billion ($4.08 billion), including Total’s Fort Hills interest and its 50% stake in the Surmont facility. However, ConocoPhillips, which operates Surmont, exercised its right of first refusal to buy Total’s stake instead of Suncor, triggering a review of Suncor’s deal with Total.
Kruger said Suncor also has internal options to increase its long-term bitumen supply.
Suncor shares dipped 0.6% in Toronto, registering a smaller loss than its Canadian peers. On Monday, Suncor reported a sharp drop in quarterly profit as oil and gas prices retreated from last year’s peak.
Kruger, a former Imperial Oil CEO, took the helm of Suncor in April and promised to improve the company’s poor record on worker safety and operational reliability.
(Reporting by Rod Nickel in Winnipeg, Manitoba; editing by Jonathan Oatis)